The COVID-19 pandemic is a crisis, a tragedy that is all at once fast and slow-moving, personal and global. The virus has killed more than 150,000 people.
Livelihoods have been hit hard as communities are cut off and businesses are forced to close. Country leaders are understandably looking for ways to stimulate their economies immediately.
During a crisis of this scale, it is understandable to the familiar. But, for their own sakes, governments must avoid defaulting to familiar investment habits – namely, ramping up production and use of high carbon emitting fuels.
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The pandemic, together with the Saudi-Russia oil price tussle last month, have had a stark impact on oil markets.
Oil futures recently went negative for the first time in history. This has highlighted how vulnerable countries with fossil fuel-dependent economies are to volatile fuel prices: in Sub-Saharan Africa, oil exporting nations could lose up to $65 billion in revenues in 2020 as crude oil prices continue to tumble.
Even before COVID-19, the global transition to a low-carbon economy was sparking a decline in oil prices. The pandemic has only exacerbated this trend, underscoring the need for diversifying these countries’ economies.
